Online retailer Flipkart has had a very successful season this year competing hard against Amazon India. Amazon, however has run an effective customer loyalty programme, Amazon Prime, where you can pay Rs. 499 and enjoy free and fast deliveries of the stuffs you order on the amazon site for one year. Amazon further beefed up this offer with the inclusion of the Amazon video streaming facility within this subscription.
Interestingly, Flipkart had also introduced a similar programme called Flipkart First; it however did not catch on and died an unnatural death. Flipkart executives were perhaps skeptical that the Amazon attempt will also not work. However, now that it has emerged that Amazon has managed to have 30% of all its orders booked by the Prime members. This might itself be the trigger for Flipkart to have a rethink on the issue.
However, Flipkart has to stretch itself to make any such offer sugar-coated for the customers, an advantage Amazon had with its video streaming service. It is learnt that Flipkart is trying to reach separate arrangements with startups like BookMyShow, cab aggregator Ola and MakeMyTrip so that the Flipkart customers signing in for the royalty programme can avail some special discounts on these sites as well.
The next day delivery is one of the major attractions within the Amazon Prime facility run by Amazon, but it costs Amazon higher, particularly where there are multiple deliveries to the same set of customers. Flipkart is already working on controlling its expenses and has to do a tight rope walk while running any such special package for the customers as envisaged.
Flipkart has already raised around $3 billion in terms of funding this year and with such large funds being invested in the organisation, the responsibility to utilise the funds prudently also gets emphasised.